Tesla faced a notable decline in profits during the third quarter, reporting a 37 percent decrease compared to the previous year. This drop was largely attributed to the company implementing larger discounts on its models to boost sales. Despite the decline in profit, Tesla’s revenue reached a record $28.1 billion, marking a 12 percent increase. Analysts suggest that the surge in revenue was influenced by the recent expiration of a federal electric vehicle credit, which drove consumers to purchase vehicles before the deadline.
In another factor affecting Tesla’s revenue, the company experienced a significant reduction in earnings from selling carbon credits, which have historically been a critical source of income. This change followed the Trump administration’s rollback of clean-air regulations, impacting the financial landscape for companies like Tesla.
Elon Musk encouraged investors to adopt a long-term perspective, emphasizing the company’s advancements in key technologies that he believes will define its future success. He highlighted areas such as artificial intelligence, autonomous driving, and robot development. Musk expressed confidence that the self-driving software would ultimately lead to a substantial increase in Tesla sales, predicting, “It’s going to be like a shock wave.”
It’s important to note that while Musk has made ambitious claims about the potential of autonomous driving in the past, actual delivery on these promises has been inconsistent.
In a move to further secure his influence over Tesla, Musk proposed a compensation package that would grant him a substantial number of shares contingent on the company meeting certain financial and operational thresholds. This package could increase his stake in Tesla to approximately 29 percent, with a valuation of around $1 trillion if successful. Musk framed his rationale for increased control on the premise that it was necessary to actualize his vision for the company effectively. He also humorously acknowledged the need for accountability, stating he could be dismissed should he “go insane,” while referencing Tesla’s ambitions to build an extensive fleet of robots.
Overall, despite the current profit downturn, Musk’s visionary outlook for Tesla’s future remains optimistic, focusing on technological advancements that could redefine both the company and the electric vehicle market.